Virtual Wallets Explained

Virtual Wallets Explained

Virtual Wallets Explained

Do you have a wallet or purse stuffed with credit cards, receipts and cash? Believe it or not, your smartphone can now take the place of all of that.

In a world where many of us already pay bills online or shop using apps, dumping the cash and plastic for a smartphone might seem logical. Mobile wallets though have been relatively slow to catch on – mostly due to uncertainty about the technology.

“There’s not a single way that you can use the [virtual] wallet,” explained Lisa Gerstner of Kiplinger’s Personal Finance, “There’s a lot of different things going on, they’re still kind of shaking out how you’re going to be using a mobile wallet.”

There are two major kinds of virtual wallets out there. Cloud-based technology, like Square, allows users to link accounts and pay with the touch of a button. There’s also a tap-and-pay method (think Google Wallet)using near field communication.

Early adopters of technology may be willing to test out these different methods without much worry but many consumers seem content to stick with what they see as safe, simple methods of payment.

“The value angle is a big one here,” Gerstner said, “A lot of people are pretty happy using their debit or credit cards just to swipe, it’s not hard to do.”

If you’re worried about storing a big chunk of financial data in your phone, experts recommend adding an extra layer of pin-protection to it. You might also want to sign up for or download a safety program that can disable your phone remotely if it’s lost or stolen.